Philippine National Bank Successfully Returns to the Bond Market With its US$300 Million Sustainability Bond Offering

Philippine National Bank (PNB) has successfully tapped into international markets with a US$300 million benchmark-sized Sustainability Regulation S offering of 5-year senior notes under its US$2 billion Euro Medium Term Note programme.

​PNB conducted a two-day roadshow starting on October 14, 2024 to engage with potential investors.

The 5-year bond was priced at T+102 basis points, with a fixed coupon rate of 4.85%. The offering was met with strong demand, as the final order book was more than 3.6x oversubscribed, reaching US$1.1 billion from global investors. Moody’s has assigned an investment grade rating of Baa3 to the 5-year bond.

In terms of geographical distribution, 89% of the investors were from the Asia Pacific (APAC) region, while 11% were from Europe, the Middle East, and Africa (EMEA). By investor type, 67% were asset managers and hedge funds, 23% were banks, and the remaining 10% were private banks, broker dealers and others.

“We believe this is an ideal time to return to the market, given the reduction in interest rates complemented by the Bank’s improved core banking activities. We have already enhanced our banking operations and processes to support continuous growth as we expect our business to further strengthen in the future,” said Francis Albalate, Chief Financial Officer of PNB.

“We are grateful for the support shown by global investors in our return to the international bond market after a 5 year hiatus. The result of this note offering is a clear indication of investors’ trust and confidence in PNB. This offering will fund the Bank’s sustainable financing initiatives as we continue to solidify our position among the forerunners of nationwide development across the Philippine banking system,” said Florido Casuela, President of PNB.

ING and J.P. Morgan were the Joint Lead Managers and Joint Bookrunners for the transaction, and PNB Capital acted as Sole Global Coordinator in relation to the Programme. ING acted as the Sole Sustainability Coordinator.

PNB posted a net income of P10.3 billion in 1H24, 5.6% higher year-on-year. This translated to a return on average equity (ROE) of 10.5%, higher than 10.3% and 10.0% in 1H2023 and 2023 respectively. Its Common Equity Tier 1 (CET1) ratio of 18.5% remains the highest among Philippine local banks.

The Notes have not been and will not be registered in the United States under the U.S. Securities Act of 1933, as amended (the “Securities Act”), or the securities laws of any state of the United States or other jurisdiction and may not be offered or sold within the United States except pursuant to an exemption from, or in a transaction not subject to, the registration requirements of the Securities Act and applicable state or local securities law. The Notes will be offered and sold only outside the United States in "offshore transactions" as defined in, and in reliance on Regulation S under the Securities Act. This press release does not constitute an offer to sell or a solicitation to buy securities in the United States or any other jurisdiction where it is unlawful to do so.

Philippine National Bank is one of the country’s largest private universal banks in terms of assets and deposits. It provides a full range of banking and other financial services to its highly diverse clientele comprised of individual depositors, small and medium enterprises, domestic and international corporations, government institutions, and overseas Filipinos. Backed by over a century of stability and excellence, PNB looks forward to more years of serving its customers first.